Who gets the house in a divorce? Who gets the engagement ring—the husband or wife? What about the investments and bank accounts?

Whether you owned a house, investments, jewelry, the engagement and wedding rings, real estate, vehicles, furniture or even a pet together with your husband or wife, when you breakup, these assets must be divided

Who gets what in a divorce?

Divorce law varies by state, and every divorce differs. If you wonder who will get what when you and your spouse break up, the answer will depend on many factors, including where you live, how long you were married, and what each of you brought to the marriage in terms of property.

Most of these questions should be addressed with your divorce attorney or mediator.

Learn how much your engagement or wedding ring is worth for free, immediately >>

However, if you have an uncontested divorce, in which you and your soon-to-be ex amicably agree to most of the terms of the split, do not have complicated finances and agree on how time will be shared with any children you have, then you may use a DIY divorce service like CompleteCase.

Read our CompleteCase review here>>

Even so, you may have questions about how property and debt are divided in a divorce. Here are some guidelines for what you can expect.

While this post deals with the property of divorce, here is what you need to know about the kids and child support in divorce.

What is the difference between community property and equitable distribution?

First, understand that there are two main types of property distribution in the United States

The way that property is divided in a divorce largely comes down to where you live. States are either a community property state or an equitable distribution state.

What is considered marital property in a divorce?

In community property states, spouses own everything equally, or property is owned solely by one spouse. 

Presently, there are nine community property states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, and Wisconsin. 

What is equitable distribution? 

In equitable distribution states, property is divided fairly, not necessarily 50/50. One spouse may receive more in the divorce, while the other may be ordered by the court to give up property. This can be influenced by how much each party earns, how much they contributed financially to the marriage, inheritances, earning potential, length of marriage and other factors.

Are you in New York City or New York state? What to know about divorcing in NY.

Marital property vs separate property—what is the difference?

In short: Marital property is anything that is jointly owned by a couple, while separate property is owned only by one person.

What is marital property? Marital property definition.

Marital property consists of possessions spouses obtain during marriage. Assets and debts are marital property. Marital property includes earnings, everything bought with those earnings, and all debts incurred during the marriage.

Marital assets can include:

  • Cars
  • RVs
  • Houses and homes
  • Pensions and benefits
  • Investments, stocks, brokerage accounts
  • Retirement accounts
  • Investment and Airbnb properties
  • Clothing
  • Furniture
  • Businesses
  • Pets

Marital debt can include:

  • Mortgages and home lines of equity
  • Student loan debt
  • Personal loans—including to family members or friends
  • Credit card debt
  • Auto loans
  • Business loans
  • Medical debt

Note: Both marital assets and marital debt are both considered marital property.

What is non-marital property / separate property?

Non-marital property is personal or separate property. It includes inheritance, gifts, compensation from personal injury, property bought using personal funds, and proceeds of a pension vested before the start of a marriage. A business started before marriage is personal property, but if it increases in value during the marriage, or if the other spouse works at the business, a portion of it may become marital property.

Investment assets, including 401(k) and IRAs, real estate holdings, savings accounts and other assets acquired before the marriage are considered non-marital /separate property. But any contributions to investment funds made during the marriage are likely considered joint property— no matter who earned that money.

Is jewelry considered marital property?

A common divorce question is:

“Is an engagement ring considered marital property or personal property? What about wedding rings? Is jewelry considered marital property?

Quick answer: Typically an engagement ring and other jewelry are considered gifts, and the recipient can do with that item as she or he pleases — including selling.

[Why you should sell your engagement ring after divorce—and where to do it safely, quickly and for the most cash]

Are separate bank accounts consider marital property?

Separate bank accounts can be marital or personal property, depending on when they were opened and if marital funds were deposited in them. If a bank account was created during the marriage, then it’s marital property unless it solely consists of inheritance, gift, or award from a personal injury settlement, suit or benefit. 

If the bank account was created before the marriage, then it’s marital property if wages or marital funds have since been added to it. Otherwise, it’s separate property (keep reading for an explanation of ‘separate property’).

[37 reasons every woman needs $1,000 in her own savings account, and how to save it and where to get the most interest]

If someone  buys real estate for their spouse solely in the receiving spouse’s name, that property can likely be considered separate, and the owner is the spouse who received the home as a gift. However, legitimate disputes could still arise if there’s a question of whether marital funds were used for the purchase. 

Are assets always split 50-50?

In community property states, theoretically, the answer is yes—assets acquired during the term of the marriage are split 50-50. 

In practice, marital property cannot always be divided exactly 50/50. Typically, spouses and attorneys and sometimes judges work together to divide the property in a way that complies with standard practices in that jurisdiction, as well as — hopefully — is fair and reasonable. Spouses may still also maintain some personal property. 

Typically, all the couple's marital assets are listed, and a dollar value assigned to each. Some of this money may be tied up in a retirement account, which would require tax penalties should it be withdrawn, and other assets are in the form of equity in a house, which can be hard to withdraw without selling the home.

In these cases, the goal is for each party to receive in the divorce equitable assets, which may mean one spouse keeps a larger share of a retirement account, while the other keeps rights to the marital home.

In equitable distribution states, the court divides marital property in whichever way it sees as fair, not necessarily equal. 

Is the wife entitled to half of everything in divorce?

In community property states, each spouse gets half of all assets, regardless of who earned the money.

Other considerations in a divorce include income going forward. This is typically paid out through alimony and/or child support, depending on the income of each spouse, custody sharing of the children, and earning potential of the husband and wife.

Increasingly, as equally shared co-parenting is more common, and women earn more and the pay gap shrinks, more women are paying child support and alimony.

Also more common today is arrangements in which parents split time with the kids 50-50 and each are financially responsible for themselves.

Who gets the house in a divorce?

Aside from situations where one spouse pays for the house before marriage and keeps it after, specific marital circumstances, including children and finances, usually dictate the fate of the couple’s home.

Here are some common scenarios about what happens to the couple's home in the divorce:

  • One spouse buys out the other's share of the home's equity
  • If the house is underwater—in which the mortgage is larger than the value of the home—then the house may be sold, and the remaining debt split between the spouses
  • If they can afford it, the couple may choose for one parent to stay in the home to maintain a routine and school district for any children they have together
  • Continue to co-own the home. You can then rent out the property and share any profits, use it as an Airbnb or othershor-term rental, ride out an economic downturn to hope to recoup any losses or increase profits in a future sale, or one of the spouses can continue to live in the home, with an agreement about how any sale proceeds would be divided in the future.

Really want to keep your house in your divorce?

The answer to this question is: It depends. 

A few hard and fast rules:

  • If one of the spouses owned the home before the marriage, it typically belongs to them.
  • If the house or condo or co-op are in either the husband or wife's name, and the mortgage is in that spouse's name, they are most likely to be in position to claim it. 

Otherwise, the question of keeping the house relies on a combination of these factors:

  • Who wants the house?
  • Who can afford the house easiest?
  • If refinancing is in order, who is most likely to qualify for a mortgage?
  • Is there equity in the home? If so, how will that be divided in a fair way? 
  • Are you underwater with the mortgage? Who wants to assume that debt? Who can afford to assume that debt?

And then there is the big question:

Should either of you keep it? Would it make more financial sense to sell the home, share any profits, and move on with both of your lives, separately, in new and different homes not straddled with old memories, broken dreams and promises?

There are pros and cons to keeping the house in the divorce. Which is right for you?

Reasons to keep the house in your divorce:

  • You can afford it easily on your own. This means that after any refinance, buy-out, you can easily afford monthly mortgage payments, taxes, insurance and upkeep on your own income. If you require alimony or child support to stay in the address, that is too risky.
    You can create a single-mom budget easily on Tiller, an easy-to-use budgeting app.
  • The home is the biggest financial asset for most couples. You walk away from that, you may lose a lot of assets — even if he buys you out. Why?
  • Historically, real estate has been a more stable investment when compared with stocks (recent years being an exception). Between 1978 and 2004, real estate appreciated an average of 8.6 percent per year. While stocks returned more than 13 percent during that time, they also saw more peaks and valleys. True, stocks grew more. HOWEVER, that is just appreciation — not including the wealth-building associated with paying off a mortgage, or the tax advantages.
  • Because your household income is very likely to be lower post-divorce in the short-term, the tax write-offs like mortgage interest and property taxes will be even more valuable post-divorce.  Plus, if you were to sell your home, you can likely pocket most or all of the profits tax-free. Only a few investment vehicles provide such a tax perk.
  • It may make sense to keep the house if it is easy to maintain on your own, without too much physical, emotional or financial cost. How to run a single-mom household like a boss
  • You can make an argument for keeping in the event that it will help facilitate peaceful co-parenting. For example, if staying put means you can live closer to your now-ex, or closer to schools or each of your jobs, which makes everyone's life more convenient, ‘happy co-parenting' can be a reason to argue for staying put. Rules for co-parenting with even the most toxic ex
  • The emotional reasons to keep the house include providing a measure of stability for you and your kids during a tumultuous time. This includes staying in the same schools and close to friends and neighbors who provided emotional and practical support.

However, there are lots of very good reasons to let your marital home go — whether to your ex, or to sell it on the market. One of the biggest mistakes I have seen in my work, as well as have heard from divorce attorneys, is women's insistence on keeping the marital home in divorce — to her detriment.

Reasons NOT to keep the house in divorce:

  • You can't afford it. Accepting that your income is now lower after divorce, and therefore you lifestyle must change, is often very difficult — especially for the lesser-earning spouse, who unfortunately is usually the woman. Going into debt, facing losing that very home you so desperately want to hang on to, and the emotional turmoil that financial stress induces is just bad news. Don't.
  • Selling helps you move on. Houses are emotional things. That house likely represented a family and life that you wanted very much to succeed — but things turned out differently. Nothing like new real estate (and furnishings!) to relaunch your new life, and put your old one behind you. The same goes for when you sell an engagement ring or some other item that you shared.
  • A new home is empowering! Whether you are purchasing a new house or renting a place on your own, moms tell me that doing this solo is one of the most empowering things they've ever done.
  • It (might) teach your kids financial responsibility financial. Because your home is likely your biggest financial asset, you should treat it with as little emotion as possible. Compromising your finances, emotional well-being and good sense for the sake of keeping a house you really like is not a good financial example for your kids.
  • Selling (might) teach your children emotional resistance. Sometimes life sucks giant, hairy donkey balls. It just does. Divorce is usually like that. But showing a measure of grace, moving on, and making wise decisions for your whole family in the face of rotten times is one of the greatest gifts you can give your kids.

How to find money to pay for a divorce

How to keep the house in a divorce using a cash-out refinance

When I got divorced 10 years ago, one of the biggest sources of stress — and confusion — was where I would live, and what my ex and I would do with our home. When he moved out, I stayed in the New York City apartment we’d bought together a few years before. There was a lot of equity in it, I felt like it was a good investment, I loved the home, neighborhood and building, and I didn’t want to move.

I contacted a few mortgage brokers to explore what my options were. Based on my income, the home value, terms of my divorce (which, in my case was that we split any equity in the home), a cash-out refinance was my best option. Since then, I have been able to finalize my divorce in a fair way, now own my home 100 percent in my name, and have a payment I can easily afford — plus a nice tax deduction every year.

How to file for divorce in New York

What is a cash-out refinance?

A cash-out refinance means that you apply for and receive a new mortgage for more than you owe. Typically, you can cash-out up to 85 percent of your home’s value. This was a great option for me, because I owed my ex a lot of money — which I did not have at the time — there was enough equity in the home, interest rates were lower than when we bought the home, and my income was enough so that I could comfortably afford the new payments.

Here is an example:

Let’s say there is $200,000 left on your mortgage, and your home is now worth $350,000. With a cash-out refinance, you might refinance up to 85 percent of your home’s value ($297,500) and take part of the $97,500 difference back in cash to spend however you like — including paying your ex his share of the divorce settlement.

Pros of a cash-out refinance during a divorce:

  • Easy way to access cash during a time when you may not have a lot of it
  • Interest rates on mortgages tend to be lower than if you were to do a home equity line of credit, home equity loan, personal loan, or credit card advance.
  • Interest rates on your first mortgage are usually tax-deductible
  • You can keep your home and don’t have to move, which can be important at a time when everything in your and your kids’ lives is in flux.
  • The mortgage is now in your name only, removing your ex from the debt and deed — which can feel really powerful for you, and be an important step in separating from your marriage and starting your life anew.

Cons of a cash-out refinance during divorce:

  • Compared with a home-equity line of credit or home equity loan, closing costs can be higher
  • Signing a new mortgage may extend the period for which you pay for the home — even if monthly payments are the same or lower (this happened to me).
  • Signing a new mortgage may increase the overall sum you will pay for the property if interest rates have increased since you first financed it.
  • If the refinance means you end up with less than 20 percent equity in your property, you may need to add PMI, or private mortgage insurance, onto your loan.

How to qualify for a cash-out refinance in your divorce

The qualifications for a cash-out refinance mortgage are the same as a new mortgage, in most cases. Because you are now divorced and seeking to own the home in your name only, the qualifications are for you as a single person (not as a couple):

Who can qualify for a cash-out refinance?

Since a cash-out refinance is essentially the same as taking out a new mortgage, requirements for qualifying are similar. Homeowners who own their homes and meet the following criteria may qualify:

  • Good or excellent credit (FICO score of 670+)
  • Significant home equity — at least 20 percent of the home’s value
  • Ability to repay the loan
  • A debt-to-income ratio — including the new mortgage payment — approved by the lender.

If you choose to refinance the home in order to buy out your ex, Credible will get you pre-qualified in 3 minutes, provides offers shortly after, and allows you to upload all documents online. Get prequalified for a mortgage refinance in 3 minutes with Credible now >>

Other notes about cash-out refinance in divorce:

During divorce, finances are often very tight — where there was once one household with two-income or one income plus a full-time person caring for the home and kids — there are now two households, two sets of insurance premiums, and increased need for child care — not to mention legal fees.

Obtaining a new mortgage is a big commitment. Even though you may be emotionally tied to your current home, staying put is not always the best answer. Even if your mortgage payment stays the same after the refinance, you may not be able to afford it without stress and scramble every month. Also, while the thought of leaving your home may feel traumatic today, you may feel differently in months and years to come. In fact, you may want to break free from old memories and expectations that are attached to the home.

Jenny Hoff at CreditCards.com interviewed me about my own story of overcoming my fears, hang-ups and neuroses when it comes to single motherhood and money. It is also about overcoming your own barriers that keep you stuck…

A refinance in a divorce works like this:

If the house was in both spouses' names, or in the name of other spouse (your husband, for example), you may want to refinance the home so that your name only is on the deed and mortgage. This relieves the other spouse from any financial or legal responsibility of the home, and can give that other spouse their share of the equity in the home.

You may also be able to get cash out to pay off credit card debt, student loans, medical debt, or your divorce lawyer. 

To see what your refinance options are, based on your credit score and income, Credible lets you learn your options in less than 3 minutes.

  1. Go to Credible.com 
  2. Fill out a single form with information about your income, credit score, and information about your home.
  3. Compare your options.
  4. Get on with your life!

Refinance your home with Credible now >>

Who owns the engagement and wedding rings in a divorce?

However, if a ring is a family heirloom, some courts may order the receiving spouse to return it to its original owner.

Jewelry is marital property if purchased during the marriage. If the jewelry in question was a gift or a form of inheritance, it’s separate property and not divisible. Jewelry acquired before marriage is also separate property. This can include a watch given as an engagement or anniversary gift to a man, or fine jewelry given to the wife as a gift.

Gifts between spouses during marriage are marital property and must be accounted for unless the spouse who gave the gift explicitly states the gift is the separate property of the receiving spouse. 

Who gets the dog in a divorce? 

Legally animals, including dogs, cats and other pets, are property. Following a divorce, the pet belongs to either one spouse or the other. Traditionally, there is no “custody” of pets.

There is, however, a recent trend in courts to view pets as more than property. In Illinois, Alaska, and California, divorce courts consider the best interests of the pet. If one spouse bought a pet, got married, and let the other spouse take care of the pet, then the other spouse could make a legal argument in those states that the pet is their joint property. 

But for now, in most states, pet ownership is dictated by simpler property laws. Pets are given to the spouse who paid for or adopted the pet. If the pet was paid for with joint funds, then the spouse who initiated the purchase receives the pet.

In community property states, if your pet cannot be considered separate property, you may still have a few options for maintaining a relationship with the pet. It is possible to co-own a pet, and you can draft provisions dictating the sharing of expenses related to its care as well as a visitation schedule  You can also try to obtain full ownership of the pet by giving up other property in exchange. Anything is negotiable.

What should I ask for in a divorce settlement?

The adage “If you don’t ask, you don’t get” applies to your divorce settlement. If you neglect to ask for what you want while negotiating, you may never have the chance. Although you can go back to court post-judgment, it’s a much safer bet, not to mention less expensive, to make your divorce agreement as inclusive as possible from the get-go.

Here are the top points to negotiate in your divorce:

  • Time sharing and legal decisions for any children you have
  • The home, or other real estate
  • Any child support or cost sharing
  • Retirement and other investments
  • Health insurance coverage
  • Ownership of any cars or vehicles
  • Ongoing mediation or therapy for the whole family [Best online therapy sites for moms]

In states with no-fault divorce laws, you’ll be entitled to equitable distribution. That means either the fair amount of marital property you acquired during the marriage or half of the community property acquired during the marriage, depending on your state. You may also be entitled to child support, typically calculated according to a simple formula. These are the biggies. Others are not necessarily obvious, so think about what your expenses are today and what they will be down the road, then speak up. 

What to do with a house after divorce?

As much as you may love your home with all its charm and memories, you may want to consider selling it. 

Why you should stay:

  • You can afford it on your own, without relying on spousal support.
  • You stand to lose a lot of money if you walk away. 
  • It’s a good investment. 
  • Tax benefits.
  • Emotionally, keeping the house makes sense (for you and your kids). 

Why you should sell your house in a divorce: 

  • You can’t afford it.
  • Selling your house will help you move on.
  • Starting fresh is empowering.
  • You want to set a good financial example for your kids by being fiscally responsible. 
  • You want to show your kids what it means to be resilient. Change is good! Living within your means is even better!

One way to keep the house if you cannot afford to buy it from your spouse is with a cash-out refinance. A cash-out refinance is when you apply for a new mortgage that is more than what you owe. The extra money is then used to buy the other’s share, leaving you the sole owner.  

Really want to keep your house in your divorce?

A refinance — including a cash-out refinance — can be a great option.

A refinance in a divorce typically works like this:

If the house was in both spouses' names, or in the name of other spouse (your husband, for example), you may want to refinance the home so that your name only is on the deed and mortgage. This relieves the other spouse from any financial or legal responsibility of the home, and can give that other spouse their share of the equity in the home.

You may also be able to get cash out to pay off credit card debt, student loans, medical debt, or your divorce lawyer. 

To see what your refinance options are, based on your credit score and income, Credible lets you learn your options in less than 3 minutes.

  1. Go to Credible.com 
  2. Fill out a single form with information about your income, credit score, and information about your home.
  3. Compare your options.
  4. Get on with your life!

Refinance your home with Credible now >>

Really want to sell your house after your divorce?

Of course, you may want to sell your house, and that could very well be the best decision. Reasons include:

  • You can't afford the house on your income alone
  • You want to downsize into something less expensive 
  • You want to downsize into a condo / town-house / smaller digs because it is easier 
  • You're relocating for a job
  • You're relocating for a boyfriend
  • You're relocating to be closer to friends / family 
  • You want a fresh start in a new place of your own
  • You just want to sell the damn house, OK?

Really, you don't have to explain yourself to anyone! 

Typically, when you sell a home and work with a broker, that costs you 5% of the sales price. Thanks to really easy-to-use technology at HomeBay, you can pay just a small fraction of that in a flat fee based — typically around 1% of the final sales price.

Here is how HomeBay works:

  1.  Go to HomeBay.com. Enter your address, property type, and when you want your listing to go live. HomeBay generates a custom to-do list based on your goals and property. These include prepping your home, and determining an asking price. 
  2. Set up the listing. HomeBay will send a professional photographer to shoot the photos, provide a yard sign, and help you set your asking price.
  3. Go live. HomeBay distributes your listing to the Multiple Listing Service (MLS), as well as Zillow, Redfin, Trulia, and Realtor.com.
  4. Show your house. Book tours, agent and buyer showings and open houses through HomeBay, which coordinates with you to confirm dates.
  5. Review offers. HomeBay flags unusual interactions to help you avoid difficult seller situations. Once you accept an offer through the platform, your home is placed on “Pending” status.
  6. HomeBay manages all the closing paperwork for you. You attend the closing, sign the paperwork. Done! 

Sample savings using HomeBay to sell your house:

Home priceWith traditional agent*With HomeBay
(estimate)
$200,000$10,000$2,000
$300,000$15,000$3,000
$500,000$25,000$4,000

*Agent fees have averaged 5% of home sale price in recent years, according to Bankrate.

Sell your house with HomeBay now >>

An engagement ring is a promise made in anticipation of marriage. Once you marry, the ring becomes your personal property and what you do with it, even in the event of a divorce, is up to you. You can hold onto the ring for your children for when they get married (though, trust me: they don't want it), repurpose it into a new piece of jewelry, sell it, or auction it. You can then use the proceeds for divorce expenses, to invest in a new home or career, go on vacation, or get any number of other positive starts to your new life.

Should I sell my wedding ring before or after the divorce?

That said, if you can wait, I recommend selling your engagement ring after your divorce becomes final. First, selling it can incite animosity from your spouse, making a high-conflict divorce worse. Second, ownership may be contested in court if the marriage was short-lived or if the engagement ring is a family heirloom.

How to sell an engagement ring or wedding ring after divorce?

CashforGoldUSA buys gold, silver, and diamonds. The company appraises each piece and will pay you in 24 hours, and is a great, fast and reputable way to sell lower-end jewelry worth $1,000 or less. CashforGoldUSA has a B+ BBB rating, and was found by Fox News to pay out three-times its competitors for mail-in gold sales.

Worthy is a unique and trusted online marketplace for fine diamonds, bracelets, Tiffany jewelry, engagement rings, watches and timepieces, earrings and more. Worthy streamlines the jewelry auction process to provide buyers and sellers with a safe experience, and guarantees you receive the highest price possible for your item.

Each item sold at Worthy receives a free GIA or IGI certification, the most trusted and recognized evaluation in the world. This expert grading report to ensure accurate valuation before going to auction, ensuring you receive the highest possible price for your jewelry.

Learn more about how Worthy works in this post, or get a fast, free estimate on their site now.

Legal Disclaimer: This article is intended for informational purposes only and should not be relied upon as legal advice on any subject matter. Consult with an attorney for more information regarding your individual situation.

About Stacey Freeman

Stacey Freeman has been published in The Washington Post, Entrepreneur, Good Housekeeping, Cosmopolitan, Woman’s Day, Town & Country, Yahoo!, HuffPost, Popsugar and Worthy. She has been quoted in The New York Times, HuffPost, and SheKnows, to name a few. She is also a single mom of three amazing kids. For more information about Stacey, visit www.writeontrackllc.com.

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